Mike Wilson, chief US equity strategist & chief investment officer at Morgan Stanley, joins Scarlet Fu and Tom Keene on "Bloomberg Money." They discuss how long-term investors should approach their portfolio.
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What Thomas Wilson said
Written from the verified transcript and checked against it. Every figure links to the moment it was said.
Mike Wilson, chief U.S. equity strategist at Morgan Stanley, said he and his team underestimated the strength and durability of the earnings recovery and AI capital expenditure, though they were directionally correct. He argued that chasing stocks is as damaging as selling at the bottom, advocating dollar-cost averaging and diversified portfolios. Wilson noted that 2022 was uniquely challenging because stocks and bonds fell together, leaving no hedge, but fully invested investors were eventually rewarded. He suggested reducing duration in fixed income and using gold as a defensive asset, noting gold has been in a bull market for 25 years. He observed a rotation through commodities, from gold and silver to rare earths, energy, and semiconductors. Wilson praised retail investors for navigating the last 15 years well, diversifying away from inflation-sensitive assets. He recommended having a plan and rebalancing, warning that many portfolios are unbalanced, particularly in large-cap growth stocks. He said cash and short-duration bonds now offer positive real returns.
Key takeaways
Gold has been in a bull market for 25 years and is a defensive asset, not a yielding one.
2022 was unique because stocks and bonds fell together, leaving no hedge for 60/40 portfolios.
Cash and short-duration bonds now offer positive real returns, a change since Covid.
We are honored to bring you Mike Wilson, Pride of University of Michigan chief, U.S. equity strategist and investment officer of small shop Morgan Stanley. This morning, how are you doing?
No. I think we probably were the first ones to talk about this earnings recovery, and even we underestimated the strength of it. So yes, we did underestimate the power of it. But directionally, I think we're right on that. I think what we've been surprised by is probably the durability of the AI capex and just how much that has accelerated and, quite frankly, how much the market has been willing to absorb.
Right. And the issuance, the reason, credit, Nick. Well, the reason you've been good at that is Jim Care. And it's got nothing to do with the equity side of the chart. Bring up the chart right now. This is the emotion. Many of you have forgotten that stocks can go down. It's a chart. Now this chart ends in 2022. But there's — it's wonderful. Great, wonderful. Covid and all that. And then there's a big rollover in 2021-22. Were you brave enough to catch the falling knife when the market rolls over like that? And my personal finance is troubled. How do I get back into the market? How, at the margin, do you buy when you see the swath of that chart?
The really challenging thing of 2022 is, you know, for retirees was that stocks and bonds went down for the first time in really our lifetime, and so there was no hedge. So even though the decline in equities wasn't as severe as it was in '08 or in '01 or '02, your 60/40 portfolio was down the same. So that was a change. I think that was one of the things that made investors apprehensive to step in. It was like, holy smokes, I'm getting hit on both my defensive stuff and my offensive part of my portfolio.
So I think people froze up. Now our job is to remind people that there's value at some point. And I would say we navigated the 2021 top extremely well and the '22 downturn. We probably overstayed our welcome a bit in '23, got back on board in '24 under the end of the story that we're telling now. But I mean, as a person who has their money in the market for retirement or a long-term investor, you really should avoid being shaken out on both the top and the bottom. In other words, chasing stocks is as damaging as selling stocks at the bottom, in my view. So that's why we like dollar cost averaging. That's what we do like, still like diversified portfolios. '22 is a challenge on that. It ended up working out for folks who stayed fully invested. And for those who stayed fully invested, their faith in equities has been restored. Maybe for bonds, not as much.
Given that the performance has not been as great, is there a way to get all your defensive bond-like exposure within equities? I've heard some people talk about the idea of swearing off fixed income completely and perhaps owning insurance companies as proxies for bonds. You get the price appreciation, you get the dividend. It's kind of like a win-win.
Yeah. Well, what I would say is that these asset classes are now more closely correlated, so they're just not going to offer that natural diversification benefit that they have historically. So that means you need to do other things. So there are other types of investments you were mentioning earlier like gold, or maybe even Bitcoin or some of these things that can defend against inflation. So we've been a very big advocate of gold, not so much as a yielding instrument but as a defensive asset. It doesn't mean you abandon fixed income, but it does mean you reduce your duration. So there are things you can do within your fixed income portfolio to make it more valuable, still provide some diversification benefit without taking too much risk.
And on the duration side — so when you talk about gold, gold was acting like a meme stock at the beginning of this year. I mean, was that just kind of a unique one-off period, or can we return to things like that?
Well, I would say that gold has been in a bull market for 25 years. I mean, people kind of woke up to this idea more recently at the beginning of the year, and this probably is a good place to kind of gravitate to for the rest of the discussion for this year. I would say we've had basically one big commodity rotation. So coming into this year, you remember at the end of last year, the Fed started printing money again, right, with this reserve management program, and that led directly to gold and silver stocks taking off. Then we went into rare earths and metal stocks, then energy stocks, and then semiconductors. Now what do all those have in common? They're all commodities. So it's kind of interesting to me that that's what's been going on. And that may be exactly what people are doing. They're looking for things that are not stocks but commodity-like to offset the risk of their portfolio with equity-like risk.
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Wilson, T. (2026, August 14). Chasing Stocks As Damaging As Selling At Bottom: Wilson [Interview transcript]. Bloomberg Television. CEOInterviews.AI. https://ceointerviews.ai/interview/1210928/
MLA
Thomas Wilson. "Chasing Stocks As Damaging As Selling At Bottom: Wilson." Bloomberg Television, 14 Aug. 2026. Transcript, CEOInterviews.AI, https://ceointerviews.ai/interview/1210928/.
BibTeX
@misc{wilson2026_1210928,
author = {Thomas Wilson},
title = {Chasing Stocks As Damaging As Selling At Bottom: Wilson},
howpublished = {Interview transcript, Bloomberg Television. CEOInterviews.AI},
year = {2026},
month = {aug},
url = {https://ceointerviews.ai/interview/1210928/},
note = {Speaker-attributed transcript with timestamps}
}
